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Strategies & Market Trends : New US Economy Policy
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To: Arthur Tang who wrote (249)11/11/2000 9:13:57 AM
From: Arthur Tang  Read Replies (1) of 435
 
The danger in the demise of the new economy? Or is it the rise and fall of the new economy?

Good wages for good work has been the character of this economy. The economy is built on obsolescence and replacement of new products and services. Yearly production of the same products will saturate the free market. So, this economy has to have energetic people constantly promoting new products and services. Work hard to reinvent ourselves. Micro-economist such as myself gauge the economy by the waste people throw out. No tons of waste is no more economy.

What FEDs worry about is inflation and lack of monetary policy to drive the economy. Those are old fashioned concepts that obsolescence and replacement theory casted out. Wages and corporate profits are the new monetary policy; we can calculate the effects of productivity and growing human resources on our economy. Top down economists' trickle down economy is no longer considered because it is too slow a growth. Supply side economy failed for many many years because of it.

Now to address the fear of inflation, we must understand wealth. You can not build an economy based on penny products. As wages and corporate profits grow, the standard of living improves. The availability of cheap goods no longer satisfy the population. So all prices rise with the growing economy(better made products grow the economy); but the product and services are of a different and better class. Chevrolet price becomes Cadillac's will never be. But people will not buy Yugo anymore or Geo Metro for that matter. Inflation numbers have become meaningless since the late 90s.

So, the diligence in our economy is a prerequisite. Laziness is the downfall if it happens in our new economy. Recycling and quick turn over of our belongings is a must to maintain and grow our economy.
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